Sonu Varghese
You Want Market Breadth? You Got It, but Be Careful What You Wish For
Everyone’s been complaining that the market lacks breadth, and now we have more of it. On October 22, 324 of 500 S&P 500 companies gained, with the median stock up 1.09% (177 gained over 2%). Yet the S&P 500 fell 1.36%, technology plunged 3.3%, and the Goldman Sachs Broad AI Index dropped 6.01%. Nine of …
Sonu Varghese
October 23, 2026
It’s All One Big Trade Now: AI or Bust
It’s easy to think of stocks, Treasuries, corporate bonds, commodities, and private markets as separate investments. But within a portfolio, they should be looked at as part of a whole, since developments in one corner of the market can quickly affect prices and expected returns elsewhere. Looking at asset classes in isolation risks missing the …
Sonu Varghese
October 16, 2026
Can Rate Hikes Slow the AI Boom? The Fed Asked the Same Question in 1999
By Sonu Varghese, Chief Macro Strategist, and Harry McDonald, Analyst, Investment Research The Fed raised interest rates in September for the first time since 2023, and the AI spending boom hasn’t slowed. The New York Times recently explained why: if a company expects an AI project to earn double-digit returns, borrowing at 6% instead of …
Sonu Varghese
October 13, 2026
Here’s Why the S&P 500 Just Hit a New All-Time High Despite Rising Interest Rates
The S&P 500 hit a new all-time high on Tuesday (October 6th), its first since August 13th. The index is up 14.2% year-to-date, or 15.2% including dividends. Many folks seem confused about why stocks are doing so well even as bond yields keep rising. The 10-year Treasury yield is at 5.29%, and the 30-year is …
Sonu Varghese
October 8, 2026
The AI Capex Boom Is Boosting Activity and Prices
I’ve written a lot this year about an inflationary growth environment (strong economic activity alongside rising prices). We flagged this in our 2026 Outlook (and again in our Midyear Outlook), and the latest update of our proprietary Leading Economic Index (LEI) for the US points to exactly that: strong nominal growth, boosted by inflation, which …
Sonu Varghese
October 6, 2026
A Goldilocks Jobs Report for Markets
Headline payroll growth disappointed again in September, with the economy adding just 29,000 jobs, well below expectations for a 90,000 gain. We also got downward revisions: August was revised from +162,000 to +133,000, and July from +21,000 to -10,000. Put together, employment in July and August was 60,000 lower than previously reported, and the 3-month …
Sonu Varghese
October 2, 2026
Inflation Remains a Problem, No Matter How You Slice and Dice The Data
We just got the latest read on the Fed’s preferred inflation metric, the personal consumption expenditures (PCE) index. This was an important release because the Bureau of Economic Analysis revised its PCE methodology, most notably replacing market-price-sensitive measures for portfolio management services with an employment-based approach that better captures the underlying quantity of services provided …
Sonu Varghese
September 30, 2026
The Consumer Is Clearly in Good Shape
The headline above seems ridiculous when gas prices are almost $4.50/gallon and diesel is at a record $6.52/gallon (nationwide averages). Inflation is running hot across the board, from electronics to pet care to lawn care. Surely consumers are struggling. But there are two ways higher gas prices can play out: Consumers pay up for higher …
Sonu Varghese
September 23, 2026
This Is Still A Dovish Fed
The Fed raised rates by 0.25%-points at their September meeting, taking the policy rate to 3.9% (3.75-4.0% range). That wasn’t a surprise, with Fed funds futures pricing in over a 90% probability of a hike on the eve of the meeting. But make no mistake: we’ve come a long way from early March, when the …
Sonu Varghese
September 18, 2026
The Inflation Data Is Going To Force the Fed To Act
Oil prices have surged over the last few weeks, taking nationwide average gasoline prices to $4.31/gallon, the highest ever for this time of year. Diesel has hit a record $6.20/gallon. That matters because diesel is what moves food and other goods across the country, allowing higher oil prices to seep into a broad array of …
Sonu Varghese
September 14, 2026